MoU signed for digital Savings Certificates issance

ISLAMABAD: The Central Directorate of National Savings (CDNS) and Central Depository Company of Pakistan Limited (CDC) signed a memorandum of understanding for the issuance of digital Savings Certificates, a statement said.

According to the MoU, the CDNS and CDC will mutually collaborate to convert and issue National Savings Certificates (NSCs) in digital form to reduce physical process flows of different transactions and develop a systematic framework through which NSCs can be inducted into the Central Depository System (CDS).

CDNS Director General Hamid Raza said that the initiative is in line with CDNS’s ultimate objective of the digitalisation of NSCs.

“The recent circumstances with the shift to digitalisation make it all the more exigent for CDNS to undergo complete digital transformation. This platform will facilitate investors of NSCs, making it easier for them to invest in and maintain their NSCs in electronic format, thereby promoting and harvesting the savings culture in Pakistan at the grass root level,” he added.

He said that the pivotal role of innovation in economic development is undeniable, with advancements in Fintech leading the change. Innovative tech-based processes can lead to higher productivity, reduced turnaround times, lower costs and wider outreach, he added.

CDC Chief Executive Officer Badiuddin Akber said that the core objective of establishing a Depository in Pakistan was to dematerialise all types of financial instruments in Pakistan.

“Considering this as our ultimate vision, we have dematerialised almost all types of securities in Pakistan; however, the NSCs are one major aspect yet to be dematerialised.

As the Depository, we feel that it is our national duty to bring our processes at par with the international best practices, and it is indeed the need of the hour that a mechanism must be developed for investors to have NSCs in book-entry form,” he added.

Through this project, the CDC will facilitate the investors, with investment in a diverse array of securities, to maintain their complete portfolio of dematerialised securities in a single account at the CDC.

This project will eliminate the risk of theft, loss, mutilation as well as the hassle of printing, dispatching and maintenance of physical certificates by maintaining the NSCs in electronic format in the CDS.

The CDC will extend the same benefits to CDNS investors as it currently provides to investors of book-entry securities in the CDS, including easy, efficient and secure transfer process for certificates, online account access and pledging facilities.

At present, CDC account can be opened through CDC offices or through digital portal of CDC from anywhere in Pakistan; however, both organisations will also work on the possibility of opening of CDC accounts through the nationwide network of CDNS offices in order to make it more convenient for investors to open CDC account and hold National Savings certificates in digital form.

CDC Chairman Moin Fudda also addressed the event where the senior management of CDC and CDNS were also present at the occasion.